Category Archives: Austrian Economics

In a room full of scholars and economic specialists last week, Dr. Gary North gave a one-hour lecture at the 2013 Austrian Economics Research Conference, that parted the curtain on a bombshell thesis he offered in order to explain (or try to explain) the modern phenomenon of continous, compound economic growth, which inexplicably began in the Western world around 1800 and has continued unabated since then, and thus answer the unanswerable question (also the title of his speech), “How Come We’re So Rich?

I say bombshell because, in an economic school of thought that is heavily populated by atheists and anarchist-leaning libertarians, that’s exactly what it is.

Not to say that anybody in the room was surprised necessarily by Dr. North’s connecting the causational dots in his admittedly unproven theory regarding the unexpected onset of long-term economic progress and radical social change during the last two centuries. He is, after all, the author of multitudes of books, articles, essays, tomes and commentaries spanning five decades, dealing with economic, social and historical issues from an explicitly biblical, presuppositional, Reformed/Calvinistic Christian perspective.

North is unique in his historical analysis because it is, in reality, a theological-historical-biblical analysis. In Austrian, as well as in non-Austrian (anti-Austrian) circles, nobody does it better.

He alludes to the uniqueness of the uniqueness of his thesis during the final part of his lecture — namely, that a sea change in ethics, beginning in the 17th century, coincided with a sea change in eschatology at the same time to begin creating a slow and steady, compounding increase in economic output and economic growth throughout the developing world, starting with northwest Europe — specifically the British Isles — and spreading almost immediately to the United States.

But why?

That’s the $64 trillion dollar question. One thing is for sure, according to North. It took from the time of Moses and the Book of Deuteronomy to the time of the battle-weary, ready-for-a-new-and-profitable-adventure Dutch Calvinists of the early 17th century for, (a), the pursuit of personal wealth and profit and material gain — entrepreneurship — to be considered a legitimate (ethical) one for man, even Christian man, and, (b), the prevailing world-and-life view and outlook with regard to the future — especially with regard to the progress and success of the Kingdom of God on earth prior to the Lord’s return — to become decidedly optimistic: postmillennialism.

He says that modern capitalism, the basic concept behind Adam Smith’s Wealth of Nations and Mises’s principle of corporate economic prosperity flowing from individual prosperity through the pursuit of “self-interest” in serving customers in a free marketplace, is a secularized version of the biblical-covenantal principle of corporate prosperity flowing from individual ethical obedience in the pursuit of prosperity and wealth in society for the service of the kingdom of God.

No doubt, some in the audience took exception with his theological explanation (hypothesis) for the reasons behind the unremitting advances and successes and progress of the modern world, both in the economic and social order. But, all were forced to admit to the fact that, to date, no one — North’s main point — has been able to offer a satisfactory explanation, economic or otherwise, for this radical transformation taking place, when it did, how it did, why it did, where it did and to whom it did.

Those of us who embrace the optimistic eschatology he spoke of, as well as the Scripture’s ethical endorsement of entrepreneurship and individual enterprise in the earthly economy of man for the service of the Kingdom of God, won’t find it hard to appreciate the mystery and majesty of the question, and the richness of the historical insights, riveting vignettes and solid theological perspectives offered by Dr. North, evinced masterfully in his speech at Mises.

A tour de force by the professor of Christian Reconstruction (and conscientious statesman of Austrian economics). Worth watching… twice!…